OTTAWA -- Despite plunging oil prices, the mayor of Fort McMurray, Alta., is still optimistic about the future of the oil boomtown.
Speaking to CTV’s Question Period, Mayor Melissa Blake said that that while the community of Fort Mac, as it is commonly known, is conscious of the low oil prices, residents are still “living life as they always have.”
“That means these plants are still in operation, we still have jobs, we get up and go to work every day, and we spend our money just as we normally would,” said Blake. “So the restaurants are still having customers coming in; so are the stores.”
Many of Fort McMurray’s 76,000 residents work in the oilsands. And with crude prices plummeting to less than $50 a barrel, down from more than $100 in June, some are nervous about what the future holds.
Oil companies are feeling the crunch. For instance, earlier this month, Suncor laid off 1,000 employees and slashed $1 billion from its capital budget in an effort to deal with dropping crude prices.
Blake said her community recognizes that the recent drop in oil prices is not going to bring the industry to its knees. However, she added that oil companies are going to have to “more mindful of their spending” in order to manage in this low-cost environment.
“The reality is we’ve seen low oil pricing in the community before and we endure until we find a different cycle coming before us,” said Blake.
Although Blake remains positive for the time being, Fort McMurray Chamber of Commerce President Nick Sanders says there is concern about future oilsands projects, many of which have been put on hold.
“What is being impacted is the future growth for future oilsands development,” said Sanders.
Potential housing woes?
One of the biggest worries in Fort McMurray right now is the housing market, which is one of the most expensive in the country. For instance, a 1,400-square-foot house listed at $739,000 -- an average price for the city -- recently dropped from an original listing price of $759,000 last summer.
Blake said that although the housing market appears to be “relatively stable” right now, that could change if people start leaving the community.
“It’s difficult to project, but if there is a mass reduction in the people that are keeping residency here and they put a bunch of houses onto the market, it could have an effect, I suppose, on what the value might be over the long term.”
Pastor Robert Parmenter, of the McMurray Gospel Assembly, said a few people are starting to sell their homes now before things get worse. During past downturns, Parmenter said he’s seen people walk away from their homes and turn them over to the bank.
Mayor rejects concerns about extremists
Blake also rejected recent concerns from Edmonton’s police chief that Islamic extremists were going to work in the oilsands in order to fund their activities before travelling abroad to join ISIS. She said that while the community rejects any kind of extremism, it’s hard to control how people use their job opportunities in the oilsands.
“Job opportunity applies to anybody from anywhere and what people do with the opportunities that they’ve capitalized on is something that goes beyond what this community has any influence or ability to understand.”
With files from CTV's Alberta Bureau Chief Janet Dirks
